Which formula represents simple interest?

The correct representation of simple interest is captured by the formula that includes the principal amount, the rate of interest, and the time duration, which is expressed as the sum of the principal and the interest earned over a specific period.

In this context, the formula consists of three components:

• P represents the principal amount, which is the initial sum of money that is invested or loaned.

• r denotes the annual interest rate, expressed as a decimal.

• t signifies the time period for which the interest is calculated, typically measured in years.

The structure of the formula shows that the interest earned is calculated as the product of the principal, the rate, and the time (P * r * t). This interest is then added to the original principal to find the total amount after time t.

This formula is straightforward and directly reflects the essence of simple interest, which is calculated on the original principal only. The other options either represent compound interest or do not accurately describe how simple interest is calculated, making option C the correct choice for representing simple interest.